Bank of Ireland chief executive Francesca McDonagh said on Monday that she had no time to be playing "fantasy politics" over the shape of the next government after the inconclusive general election.
However, even a cursory glance at the political landscape should put paid to bankers’ hopes for a return to bonus payments, which have been banned across bailed-out banks since 2008.
Minister for Finance Paschal Donohoe knew better than to publish before the election a government-commissioned report – sitting on his desk since last June – that is known to have called for an easing of pay restrictions.
Any new administration formed from the current political confusion will likely long-finger the issue even further. But that hasn't stopped Bank of Ireland planning in hope.
Its annual report shows that it continued to pay outside advisers Mercer Kepler and Willis Towers Watson – and bring Deloitte on board – to advise on pay, including "remuneration benchmarking" of its executive committee, "variable pay structures", including long-term incentive schemes, and "evolving pay regulations and market pay practices".
The bank's chairman, Patrick Kennedy, used his review to bemoan the restrictions as competition for talent in key areas such as risk, finance and compliance is intensifying as more international financial firms move activities to Ireland.
“We are concerned about potential risks that could open up in the Irish banking sector as a result,” he said. “This disadvantage is most keenly felt by investors in Bank of Ireland as the only institution to have repaid fully the investment of the Irish taxpayer at the time of the financial crisis.”
Kennedy highlighted that the bank's goal was to ultimately introduce a bonus policy consistent with European Banking Authority (EBA) guidelines issued in the wake of the financial crisis, which include malus and clawback provisions for misconduct or if a lender suffers a financial setback.
He’ll have to wait until a line is finally drawn under the tracker-mortgage scandal – with most banks still awaiting regulatory fines – before getting a hearing from any new finance minister.
